Hong Kong: Stepping Up Water Security?

Are steps taken by government to address HK's water security sufficient? Sophie le Clue expands

54% of Hong Kong's water is domestic consumption

Hong Kong consumed almost 100% of its share of Dongjiang water in 2011

Pollution and competition will bring unsureness to Dongjiang's future water supply

Last month on this website, Su Liu of Civic Exchange highlighted Hong Kong’s vulnerability, being largely dependent on the Dongjiang (DJ) River in southern China for over two thirds of its fresh water supplies. Liu argued reasonably, that increasing pressure on the DJ River from a growing and already heavily industrialized catchment, with a population of over 40 million and increasing, is cause for concern. This month, we dig deeper and examine how precarious Hong Kong’s position is and what the government is doing to assure Hong Kong’s water security for the future. In doing so, we have also talked to the Water Supplies Department (WSD) of the Government where Assistant Director / Development, Bobby Ng provided informative response to our questions in an interview here. In addition we asked Daniel Cheng a water expert with many years experience in Hong Kong & China to provide us with five challenges and some solutions facing Hong Kong’s water supply. See here.

A problem not forgotten

Firstly, the good news is that the Hong Kong Government is fully aware of potential water supply constraints, given our reliance on China; a country struggling to meet its own freshwater needs. Hong Kong’s water rationing in the sixties at four hours of water supply every four days, is no doubt a memory that the HKSAR Administration would like to keep a distant one.
In fact, in April and May of this year the Legislative Council Panel on Development published several interesting papers as part of its development and planning process1. A quick review of the figures reveals that in fact a catchment of at least 52 million people potentially benefit from the DJ River Basin Water Allocation Plan to varying extents, including Hong Kong residents. This Plan provides for the allocation of water designated by location, the amount of which inevitably varies under drought versus normal yield2 conditions (see Table 1). Hong Kong’s share under the plan is 1,100Mm3. However, the annual supply ceiling of DJ water specified in the current Water Supply Agreement up to 2014 is 820Mm3, which was delivered based on a water supply reliability analysis to ensure round-the-clock water supply in Hong Kong even under a 1 in 100 year drought. In 2010 this amounted amounted to 88% of the city’s fresh water consumption.Source: Water Supplies Department website, accessed August 2012

Hong Kong’s share of China’s water

Comparatively, Hong Kong takes a relatively small portion of the GD Province’s DJ allocation under the plan; that is a 156 Mm3 or 10.3% [based on the allocation of 1,100Mm3] per capita regardless of yield conditions, compared to 597 m3 (16.5%) and 551m3 (23.8%) respectively, for Heyuan and Huizhou (under normal yield conditions). Worth remembering, that unlike these other cities, Hong Kong is primarily a service sector economy with no heavy industry and therefore its water needs should be substantially less. Hong Kong’s allocation is not too different from Shenzhen’s at 160.55 m3 under normal conditions and 155m3 under drought conditions, a city with a significant industrial base and a population 46% higher, by comparison.

Balancing water demand and supply

“Hong Kong needs to save precious water resources and pumping costs, as well as be a good partner with respect to other municipalities in the Pearl River.”

Assistant Director WSD, Bobby Ng, August 2012

The Hong Kong Government’s strategy is to make sustainable use of water resources, planning the amount needed based on Hong Kong’s actual demand and own water reserves at the time. As WSD Assistant Director Bobby Ng notes “Hong Kong needs to save precious water resources and pumping costs, as well as be a good partner with respect to other municipalities in the Pearl River.”
The Government therefore balances leaving some buffer in its reservoirs with taking the minimum from the DJ River that meets demand. Until 2011, Hong Kong had rarely taken near its annual supply ceiling of 820Mm3. Indeed, since 20063, the average has been about 86% of this ceiling figure, amounting to 70-80% of Hong Kong’s fresh water consumption. Last year however, following what appears to have been a 1 in 70 year drought, Hong Kong took almost 100% of the ceiling figure at 818 Mm3 4.Source: Legislative Council, Panel on Development: Administration’s paper on 345WF – Planning and investigation study of desalination plant at Tseung Kwan O (Supplementary information paper), May 2012

Sourcing additional supplies

Whichever way we look at it, Hong Kong is near its maximum current allocation and to better prepare for challenges such as climate change and low rainfall, must investigate and explore additional sources to meet rising water demands.
The Chinese cities also relying on the Allocation Plan are likely in a more precarious situation. Most, experiencing rapid growth, are exceeding their allocations and supplementing water needs from other sources, such as the Xijiang to the west, the Hanjiang to the north east, the Beijiang to the north and also possibly from groundwater – which is itself fraught with various challenges.

“Hong Kong, given the challenges of acute climate change and being one of the responsible partners in the Pearl River Delta should investigate and explore alternative water resources in order to minimize the risk of water shortage and mitigate possible difficulties encountered by our neighbours in Guangdong Province when they face a drought.”

Assistant Director WSD, Bobby Ng, August 2012

The issue of concern is not that the DJ River does not provide a limitless supply – this we know, but that supply is uncertain. The river’s long term mean annual flow is reported as 32,700Mm3 and extraction must not exceed 33% i.e about 10,700Mm3, or else significantly impact it ecological functions5. In recent years however the total water resources of DJ River Basin has been fluctuating greatly.
Add in pollution and the potential regional competition for resources, and it’s certainly reasonable to question whether future supplies are a sure thing. Just looking at growth in power generation for example, we can see that Guandong Province is estimated to increase installed generation capacity by a huge 45% between 2010 and 2015, roughly enough energy to meet the needs of 15.9 million inhabitants; the water demands to generate this power will be significant and how much will be sourced from freshwater?
The unknown and somewhat complicating factor in all of this is our old friend climate change. While the HKSAR government plans on the basis of a 1 in 100 year drought – we have already had two very water lean years recently (2004 and 2011) when we took proportionally more of our allocation from the DJ. Whether last year’s 1 in 70 year occurrence means that the probability of a future drought is low in coming years, as might be expected is this up for debate.
What all this uncertainty means is that the government is under pressure to ensure Hong Kong’s water security in an extremely challenging.

Introducing total water management

“examine fresh water demand and supply in Hong Kong and to evaluate all major options of management in terms of water saved or supplied.”

Assistant Director WSD, Bobby Ng, August 2012

Having recognized the pressure and challenges, the government commissioned a study seven years ago to “examine fresh water demand and supply in Hong Kong and to evaluate all major options of management in terms of water saved or supplied.”

The outcome is its Total Water Management Strategy introduced in 2008, which can be viewed here; an evolving plan aimed at securing Hong Kong’s water supply through a range of measures with emphasis on containing demand growth.
Such measures have included using advanced technology for leakage control, a replacement and rehabilitation programme aimed at 3000km of old water mains, extending use of sea water for flushing, examining the feasibility of water reclamation, promotion of water saving devices through a water efficiency labeling scheme , retrofitting water-using devices in government premises and schools, water conservation competitions and a range of public awareness raising activities.
Quite rightly the government has focused some of its resources on public education, targeting schools and domestic households through a variety of materials and initiatives, including resources for students such as teaching kits, leaflets on ‘Water Conservation at Home’ in Thai, Indonesian, Tagalog and English as well as Chinese which can be viewed here, al ‘Water Conservation Ambassador Selection Scheme’ and a school water audit scheme.It’s difficult to say whether all these efforts are working, since few people we talk to seem to realize that water should be conserved. It is noticeable however that since 2008 freshwater water consumption has fallen.
The reason for the government’s emphasis on reducing consumption is clear – Hong Kong residents use a lot of water and the figures speak for themselves; fifty four per cent of Hong Kong’s total water consumption is domestic which amounts to approximately 129 litres per capita per day of metred water6, excluding flushing water. If we add in flushing (fresh and seawater7) this rises to 220 litres per capita per day (including the unmetered flushing water).In terms of global comparisons this puts us in around the top of third quartile of water consumers based on a survey of 100 major cities in 20088. For a more direct comparison, Singapore’s water use in 2010 was 45% domestic amounting to about 150 litres per capita per day.
Worth noting perhaps, that Hong Kong is also one of the top consumers of bottled water globally ranking 18th at about 95 litres of water per person per year.

And water pricing?

One of the more obvious demand management strategies is water pricing. Hong Kong’s price of water is certainly on the low side by global standards and is just 0.3% of household expenditure9. Singapore’s tariffs are three times Hong Kong’s and much of the developed world is 6-10 times higher. There are exceptions to the rule however; in Dublin, Belfast and Cork, in Ireland – water is free.

“the Government has no plan to increase the water tariff at the moment”

Assistant Director WSD, Bobby Ng, August 2012

Certainly increasing the price of water is controversial – since water is a valuable and increasingly scarce resource, yet one that everyone has a right to. In Hong Kong is seems that increasing prices maybe just too political and water hikes, at least for the time being, do not appear to be on the cards, as AD Ng notes ‘the Government has no plan to increase the water tariff at the moment. Water prices are however rising in many jurisdictions across the globe.

Number crunching, deficits and saltwater

More recently the government has also been number crunching and modeling various scenarios. By its own accounting it estimates that total water demand management strategies will save about 41 Mm3 of water by 2020. This however will be entirely offset by the estimated 10% rise in population, i.e. an increase of 42Mm3 in demand.
This leads us to the government’s recent move to push forward desalination as part of the solution, Hong Kong is after all surrounded by saltwater. See here for the government’s rationale to pursue desalination.
The move to build a desalination plant appears to be happening quite quickly and a medium sized desalination plant is now in the planning and investigation stages.
If all goes well the plant should be operational by 2020 with the capacity to provide 50Mm3 of desalinated water annually and with potential expansion up to 90Mm3 if needed. No additional reservoirs are deemed necessary and desalinated water will be piped from the coast at Tai Miu Wan to Tseung Kwan O Primary Service reservoir.
Note that China is also going the desal route and aims to attain a desalination capacity of about 800-950Mm3 annually by 201510.
The planned 50Mm3 will easily cover the adverse scenario modeled by Hong Kong’s government. That is, a 39Mm3 deficit by 2020 taking into account forecast water savings, population increase and low water yields locally, occurrance of consecutive droughts and based on today’s supply of 820Mm3 from the DJ River. This scenario however does not seem to account for a situation whereby the Water Allocation Plan changes significantly. What if, by 2020 the GD Province could only supply to Hong Kong two thirds of the water it supplies now due to reduced availability as well as increasing competition?
In 2009 several of the GD Province’s reservoirs were down by 25% as compared to a normal year. The provincial authorities managed to retain supply to cities under the Water Allocation Plan, including Hong Kong, but reportedly at the expense of sacrificing its hydropower generation11.
However, WSD’s AD Ng qualifies that “the quantity of the DJ water ceiling of 820Mm3 and the ultimate annual supply quantity of 1,100Mm3 were agreed by the GD Province and stated explicitly in the DJ Water Agreement respectively. Taking account of these GD’s commitments, the capacity of the desalination plant has been proposed based on various adverse scenarios from the risk assessment to cater for the forecasted demand after 2020.”

The bottom line

The bottom line is that balancing Hong Kong’s water supply and ensuring water security is a complicated matter and there are many influencing factors, which are both unpredictable and beyond the government’s control.
In Hong Kong, residents must heed the government’s advice and address our everyday water use – Hong Kong’s water consumption is unnecessarily high. At the same time we should encourage the government to make sure sufficient resources are made available to outreach and educate as much as possible and further develop and implement its water management strategy.
Despite all current efforts and without a crystal ball, there is no room for complacency; as it is by no means certain that Hong Kong’s water future is secure.

We believe regardless of whether we care for the environment that water risks affect us all – as investors, businesses and individuals. Water risks are fundamental to future decision making and growth patterns in global economies. Water scarcity has emerged as a critical sustainability issue for China's economy and since water powers the economy, we aim to highlight these risks inherent in each sector. In addition, we write about current trends in the global water industry, analyze changes occurring both regionally and globally, as well as providing explanations on the new technologies that are revolutionizing this industry.
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